Securities and Alternate Board of India (Sebi)-registered funding advisors aren’t allowed to deal in unregulated merchandise reminiscent of digital gold, the capital markets regulator clarified in a press launch on Thursday.
On 26 August, exchanges had prohibited inventory brokers from dealing in digital gold. Funding advisors can not supply advisory, distribution or execution companies for digital gold, and such unregulated actions might appeal to penal motion underneath the SEBI Act, 1992, the regulator added.
Fintech corporations registered as funding advisors with Sebi provided digital gold companies, whereby clients might purchase small portions of digital gold on the apps and the gold could be saved with accomplice corporations. In some instances, the platforms have been referring shoppers to accomplice corporations as a substitute of providing the product straight.
On 10 September, Paytm Cash, which is registered as an funding advisory, had in a weblog submit mentioned that digital gold will solely be obtainable on the ‘Paytm’ app and never on Paytm Cash.
“Digital gold is a product provided by Paytm, which isn’t a stockbroker or funding advisor. As a result of which, our companies will stay unaffected and you’ll proceed to purchase/promote or observe your digital gold seamlessly on the Paytm app,” the corporate had mentioned within the weblog submit.
Supply: Live Mint